D'Onofrio v. Galliotto

Pek Cukiam. The decree appealed from is affirmed for the reasons stated in the opinion filed in the court below by Vice-Chancellor Egan except in the respect following, which will require modification. The decree erroneously gives credit to the defendants for the full amount of interest, legal as well as illegal, already paid to the complainant on the usurious loan. The statutory provision (An act against usury, J Comp. Stat. p. 5705 § £) is that in suits to collect under a usurious contract “the amount or value actually lent without interest or costs of suit may be recovered and no more,” and there are numerous decisions in consonance therewith. But of course the lender does not sue to recover that which has already been paid to him. The pertinent words of the statute as to payments made before the bringing of suit appear in the same section and are: “* * * if any premium or illegal interest shall have been paid to' the lender, the sum or sums so paid shall be deducted from the amount that may be due as aforesaid and recovery had for the balance only.” “The sum or sums so paid” manifestly are premium or illegal interest. Interest up to and including six per centum per annum on the amount actually lent is not illegal; consequently the deduction to be *275 credited on that account is the usurious interest paid in excess of that percentage. Kohn v. Kelly, 76 N. J. Eq. 132, and cases therein cited; Frankel v. Major, 9 N. J. Mis. R. 96; Colleran v. Wall, 116 N. J. Eq. 284. Interest paid on so much of the mortgage amount as represented bonus and not money loaned was illegal and is to be applied as a credit if in conjunction with other interest moneys it totalled to more than six per centum per annum of the real sum. For modification — The Chief-Justice, Parker, Lloyd, Case, Bodine, Donges, Heher, Perskie, Van Buskirk, Kays, Hetfield, Dear, Wells, JJ. 13.